Monday Report
Utah Sub-Prime Loans February 12th 2008




Sub-Prime Loans - Decrease in House Values/Tax Base

Where is the biggest problem?

The "Top 10"

  1. California
  2. New York
  3. Florida
  4. Illinois
  5. New Jersey
  6. Maryland
  7. Arizona
  8. Massachusetts
  9. Virginia
  10. Pennsylvania


  • #11 Nevada
  • #15 Hawaii
  • #17 Colorado
  • #19 Oregon

Homeowners living near foreclosed properties will see their property values decrease $5,000 on average.

Sub-Prime Loans - Utah Counties - 2005-2006

RankCounty # of Sub-Prime Loans% Loans Sub-PrimeProjected # Homes Lost to ForeclosureAverage Value Decrease per Housing Unit
1Salt Lake18,49625.6% 3,218$2,722
2Utah6,973 22.0% 1,283$2,130
3Davis4,342 20.7% 777$1,915
4Weber3,753 27.1% 672$1,560
5Washington 2,89623.0% 571$2,181
6Tooele1,217 29.9% 212$1,803
7Cache780 16.9% 133$1,459
8Summit456 11.8% 79$5,447
9Juab128 27.5% 24$1,665
10Morgan89 14.7% 16$2,374
Total/Average39,130 23.7% 6,985$2,400

Source: Center for Responsible Lending, January 18, 2008

Advice from a New Age entrepreneur

Chris Reed, chief executive of Reed's Ginger Brew, offers some tips for business founders:
  • "Work at keeping a positive attitude. The mind is a powerful creative force in your business: it affects everything you do."
  • "It's never as bad as you think when you are facing problems. Remember to breathe, and don't let the pressure overwhelm you into making decisions."
  • "Study other people who have made it and base at least your starting point on a successful model."
  • "Try to make a difference. Do something you believe in or love. The money only goes so far."
  • "Do not let your emotions rule you. If you are feeling afraid or doubtful, keep moving forward."
  • "Don't always be reasonable when the reality seems hopeless. Pull back from the details and just dream."

Source: The Financial Times 2008

Cost of Democracy?

Cost per Delegate - US Presidency:
  • Giuliani - $48,000,000 (no delegates)
  • Paul - $5,000,000
  • Romney - $654,000
  • Obama - $119,000
  • Clinton - $90,000
  • McCain - $57,000
  • Huckabee - $45,000

Source: New York Times

Note: The calculation is based on end-of-year figures and does not take into account fund-raising in 2008 or the spending since the nominating process began in Iowa on Jan. 3.


  • The Dress Barn
  • The Dress Barn, Inc. trades as dressbarn and dressbarn woman at 820 locations throughout the contiguous U.S.
  • The stores, selling misses' and women's apparel, occupy spaces from 7,000 sq.ft. to 8,000 sq.ft. in lifestyle, outlet, power and strip centers as well as downtown/urban and tourist locations.
  • Plans call for 60 openings throughout the existing market during the coming 18 months.
  • Preferred cotenants include grocery, discount department and fashion apparel stores.
  • Preferred demographics include a population of 100,000 within a three-mile radius earning a median household income of $45,000.
  • The company prefers to locate in centers with GLAs of at least 150,000 sq.ft.
  • For more information, contact
    • Elise Jaffe, T
    • he Dress Barn, Inc.,
    • 30 Dunnigan Drive,
    • Suffern, NY 10901;
    • Web site: www.dressbarn.com.
  • Borders
  • Borders, Inc. trades as Borders at 587 locations nationwide and internationally.
  • The book shops occupy spaces of 22,000 sq.ft. to 25,000 sq.ft. in malls, lifestyle, power and specialty centers.
  • Plans call for 12 to 15 openings nationwide during the coming 18 months.
  • Typical leases run 10 to 15 years.
  • Preferred cotenants include Best Buy, JCPenney, Kohl's, Office Max and Target.
  • Preferred demographics include a population of 200,000 within five miles earning $50,000 as the average household income.
  • Major competitors include Barnes & Noble.
  • For more information, contact
    • Vince Vizza,
    • Borders, Inc.,
    • 100 Phoenix Drive,
    • Ann Arbor, MI 48108;
    • Web site: www.borders.com.
  • Oreck Clean Home Centers
  • Oreck Franchise Services, LLC trades as Oreck Clean Home Centers at 460 locations nationwide and in Canada.
  • The shops, offering vacuum cleaners and accessories, occupy spaces of 1,000 sq.ft. to 2,000 sq.ft. in freestanding locations, lifestyle, power, specialty and strip centers.
  • Plans call for 35 openings nationwide during the coming 18 months.
  • Typical leases run five years.
  • The company is franchising.
  • For more information, contact
    • Doug Van Tassell,
    • Oreck Franchise Services, LLC,
    • 414 Union Street, Suite 1910,
    • Nashville, TN 37219;
    • 615-349-1511,
    • Fax 615-742- 1895;
    • Email: dvantassell@oreck.com;
    • Web site: www.ownanoreckstore.com.
  • Goin Postal
  • Goin Postal operates 250 locations nationwide.
  • The centers, offering shipping supplies, copying, faxing, mailbox rentals and office supplies, in addition to providing postal shipping, occupy spaces of 1,200 sq.ft. to 1,400 sq.ft. in downtown areas and entertainment, outlet, specialty, strip and value centers.
  • Plans call for 100 openings nationwide during the coming 18 months, with representation by Ape Realty, Inc.
  • For more information, submit
    • sites by email to
    • Mark Camara,
    • APE Realty, Inc.
    • Web site: www.aperealty.com.


Sub-Prime Loans in Utah

  • Who stands to lose the most?
  • What is the impact on neighboring properties?

Bob Springmeyer

Bonneville Research

    • International Business Confidence
    • Business sentiment is very weak, signaling recession in the U.S. and soft growth in Canada and Europe. Confidence is measurably better in Asia and South America, but is off substantially since this past summer. Real estate firms and financial institutions are the most worried, but business service firms and even manufacturers are measurably more nervous. Hiring intentions have fallen sharply during the past two weeks, and equipment investment has also notably weakened. Pricing pressures remain subdued despite currently high oil prices.
    • Productivity and Costs
    • Nonfarm business productivity growth was surprisingly strong in the fourth quarter, coming in at 1.8% (SAAR), down from 6.0% in the third quarter. This was well above consensus. Productivity growth was 2.6% from the fourth quarter of 2006 to the fourth quarter of 2007. It was 1.6% for all of 2007 compared to all of 2006, up from 1% the previous year. Nonfarm unit labor costs rose an annualized 2.1% in the fourth quarter, after two consecutive declines. This was below consensus. This is good news, as it will help quell inflation concerns.
    • ISM Non-Mfg.Index
    • The nonmanufacturing index contracted in January, falling to 44.6%. The business activity index fell to 41.9%, which was the first contraction in 58 months for the index.
    • Jobless Claims
    • Initial jobless claims dropped 22,000 to 356,000 from the previous week's holiday-inflated figure. The decline in initial jobless claims was not as steep as some had expected and thus an indication that layoffs are accelerating.
    • Consumer Credit (G19)
    • Consumer credit increased in December by a very modest $4.5 billion to $2.519 trillion. The details of the report showed that demand for both revolving and nonrevolving credit increased over the month, but well off the pace set in November. Demand for revolving credit will remain sturdy as rising joblessness, falling house prices, and slower income growth force consumers to turn to credit cards to finance consumption.
    • Pending Home Sales
    • The pending home sales index declined by 1.5% in December from a month ago. This follows the 3% revised decline in November. At 85.9, the index was down by 24.2% from a year ago. November's index was revised downward to 87.2 from 87.6. The index's large decline suggests that home sales will continue to slow over the next several months in light of continued weakness in the nation's housing market.
    • MBA Mortgage Applications Survey
    • The composite market indices finished mixed for the week ending February 1 but positive on the whole. The composite index is up 3% from last week, while the purchase index rallied from its two-week decline and is up by 12%. The rush to refinance mortgages shows signs of slackening-the refinance index is down by 1% over the previous week, though still at a very high absolute level.
    • Chain Store Sales
    • Chain store sales rose 0.5% in January, the weakest January result on record back to 1970, according to the ICSC. Growth was also the slowest for any month since 2002 after adjusting for Easter distortions. Retailers prepared and responded with cost-cutting, helping offset the blow to margins. Nonetheless, this provides more evidence that consumers are cutting their spending.
    • Oil and Gas Inventories
    • Crude oil inventories rose by 7.0 million barrels for the week ending February 1 according to the Energy Information Administration, far surpassing expectations of a 2.6 million barrel build. Distillate supplies unexpectedly rose by 0.1 million barrels. Gasoline inventories rose by 3.6 million barrels, surpassing expectations of a 2.0 million barrel build. Refinery operating capacity contracted again to 84.3% from 85% the previous week. This is yet another bearish oil report.
    • Weekly Natural Gas Storage Report
    • Working gas in storage fell 200 Bcf in the week ending February 1. This is a larger-than-expected withdrawal and will have a bullish effect on prices.

    Source: Economy.com 2008

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